## Facts

- Chipsco, Inc. (Chipsco) manufactured and sold injection molds.
- In January 1999, Chipsco prepared a written price quotation for Polytop Corp. (Polytop) for a specific injection mold.
- Chipsco’s quotation included standard terms and conditions containing a mandatory arbitration clause for disputes arising out of the transaction.
- About three weeks later, Polytop sent Chipsco a purchase order for the mold.
- Polytop’s purchase order included boilerplate stating that any “additional or different” terms proposed by the seller were rejected unless Polytop expressly assented to them in writing.
- The parties later repeated the same quotation–purchase order exchange for a second mold, again with an arbitration clause in Chipsco’s quotation and the same “additional or different terms rejected” language in Polytop’s purchase order.
- Polytop later sued Chipsco in Rhode Island Superior Court for breach of contract, alleging late delivery and poor quality of the molds.
- Chipsco moved to stay the court action and submit the dispute to arbitration based on the arbitration clause in its quotations.
- The Superior Court granted the stay and enforced arbitration; Polytop appealed to the Rhode Island Supreme Court, arguing the arbitration clause was not part of the parties’ contracts.

## Issues

1. Under U.C.C. § 2-207, did Polytop’s purchase orders operate as acceptances of Chipsco’s price quotations even though they contained boilerplate rejecting “additional or different” seller terms unless expressly assented to in writing?
2. If Polytop’s purchase orders were acceptances, was the arbitration clause in Chipsco’s quotations part of the parties’ contracts so that the court action had to be stayed in favor of arbitration?

## Decision

- The Rhode Island Supreme Court affirmed the Superior Court’s order staying the litigation and requiring arbitration.
- The court treated Chipsco’s price quotations as offers and Polytop’s purchase orders as definite and seasonable expressions of acceptance under U.C.C. § 2-207(1).
- Polytop’s boilerplate rejecting “additional or different” terms did not make its acceptance expressly conditional on Chipsco’s assent to Polytop’s terms.
- Because the arbitration provision was included in Chipsco’s initial quotations (the offers), it became part of the contracts when Polytop accepted those offers by purchase order.
- With a valid arbitration agreement in the contracts, the dispute had to proceed in arbitration rather than in court.

## Legal Principles

- Under U.C.C. § 2-207(1), a definite and seasonable expression of acceptance forms a contract even if it contains additional or different terms, unless the acceptance is expressly made conditional on the offeror’s assent to the offeree’s terms.
- General “my terms only” language (rejecting additional or different terms unless expressly assented to) does not, by itself, make acceptance expressly conditional; the form must clearly communicate, in substance, “I accept only if you agree to my terms.”
- When a disputed term (such as an arbitration clause) appears in the offer being accepted, that term is part of the contract upon acceptance; it is not treated as a later-added term supplied by the offeror after the acceptance.
- Courts will stay litigation and compel arbitration when the parties’ contract includes an enforceable arbitration clause covering the dispute.

## Conclusion

In Polytop Corp. v. Chipsco, Inc., the Rhode Island Supreme Court held that Polytop’s purchase orders did not expressly condition acceptance on Chipsco’s assent to Polytop’s boilerplate terms, so the purchase orders were acceptances of Chipsco’s quotations under U.C.C. § 2-207(1). Because Chipsco’s quotations (the offers) contained the arbitration clause, the clause was part of the contracts and the Superior Court properly stayed the lawsuit and required arbitration.


Polytop Corp. v. Chipsco, Inc., 826 A.2d 945 (2003)